Caution remains as tech sector failure rates remain stable

The IT sector continues to show stability in the number of firms hitting the wall showing its resilience and well placed position compared to some other areas of the economy.

According to the latest insolvency figures from Experian the number of IT firmsfalling into insolvency in May was 52, which was 0.05% of the business population and a slight decrease on the volume of collapses at the same point in 2010.

The Experian figures showed that across the economy the largest firms started to stablise with few of the 501 employees or above firms failing and overall the number of insolvencies remained almost unchanged with 1,674 firms collapsing in May.

Max Firth, managing director of business information services at Experian UK & Ireland, said that the increase in insolvencies was relatively small and year on year the picture was not that different.

But he advised resellers to remain cautious: "In all economic climates, we urge businesses to ensure they effectively manage risk around their portfolio."

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